7 ways to get financially sorted after a breakup
10 May 2019
When you’ve just broken up with your significant other, there’s a lot to think about and consider. You’re deciding how your assets (and liabilities) will be separated, who will have reign over your favourite pub, and what your life looks like when you’re spending a lot more time with yourself. Usually, all these thoughts are swirling around while one person is dealing with the situation much differently to the other.
Here’s the good news: you can make your breakup a lot easier on yourself (or the friend you’re supporting through these tough times) by taking a systematic and methodical approach to sorting out any shared finances. Here are a few key points to remember:
1. Separate your finances
Joint bank accounts that have joint cash and joint debts including credit cards or personal loans are a huge consideration. You don’t want to be liable for their share of the debt if they stop making repayments.
2. Work out your position
After your money is separated, it’s time to work out your position. Take stock of your debts and assets to work out your new net wealth. This is the first step towards planning for an independent financial future.
3. Fix up your budget
There’s a chance you shared a lot of budget line items with your ex-partner. Do up a budget with only your income and spending. It’s likely that some of your expenses will go up - especially if you end up changing your living situation. You may also find you’ve got a bit more spare money for yourself.
4. Tell Centrelink
If you were receiving a Centrelink benefit separately or together, make sure you report the end of your relationship to Centrelink ASAP, which will likely affect the rate of payment received. On the flip side, if you were unemployed, studying or a stay at home spouse, or a low income earner, and ineligible for Centrelink because of joint income, you may now be eligible for a payment as a single person.
5. Set new goals
Once your budget is sorted and your income is stable, start setting new financial goals that are just for you – not anyone else. Think about the things you want to do with your life that cost money, set targets, and start working towards them.
6. Update your insurance, your super and your will
If your partner was nominated as a beneficiary of your Will, your superannuation or your life insurance policy, it’s likely you’ll need to have these documents updated. Seek legal or financial advice if you’re not sure how to do this – remember that your super fund should be able to walk you through changing your binding death benefit nomination.
Looking for more advice on what to do after a break up? BUSSQ built Skylight Financial Solutions to provide affordable financial solutions for wherever you are in life. Book an obligation free appointment today, or visit skylight.com.au for more information.